HRT announces changes to light rail budget, schedule

Construction of Norfolk's
starter light-rail line is running as much as 41 percent over its original
budget, and that has angry local leaders demanding an explanation from Hampton
Roads Transit, which manages the project, The Virginian-Pilot reports. HRT
officials said this week they need $38 million to $40 million more to finish
the 7.4-mile transit system, which is just over 50 percent complete.

When construction started
in October 2007, the budget was $232 million. That figure escalated to $288
million in December 2008. The latest cost estimate is $326 million to $328
million, HRT President Michael Townes said. Officials said the complexities of
building in old, downtown streets as well as project enhancements have driven
up the cost.

As a result, light rail's
opening date has been pushed back again. Originally set to open next month and
later pushed to October 2010, it now will be delayed up to three more months -
into the first part of 2011, Townes said.

Most Norfolk City Council
members and elected leaders who make up HRT's governing board were not aware of
the cost overruns and delays until they were contacted Friday by The
Virginian-Pilot. The issue came to light when the Commonwealth Transportation
Board voted to spend an extra $20 million on the project. Already, the state is
contributing $67.1 million. The federal share is $167.2 million and the city's
is $53.7 million.

While the city is legally
responsible for the other $18 million to $20 million, City Manager Regina V.K.
Williams said the city and HRT are working to find federal money and other
sources to fill the gap instead of dipping further into city coffers.

A number of elected
leaders have been asking for light-rail budget updates, but said they either
got no responses or inaccurate responses.

"I'm very disturbed by
the quality of information received from HRT's senior staff and the lack of
accurate information received from HRT senior staff," Wood said. "When every
single meeting we have we're told we're on budget and on schedule when we're
not, that's a major issue."

Townes and Williams said
a number of factors have contributed to the increased costs. Several aspects of
the project have been enhanced, including safety and security elements,
passenger stations, the design of the storage and maintenance building,
park-and-ride lots and landscaping. Additionally, the challenges of embedding
tracks in the streets of downtown have proven costly, in terms of both money
and time. A key issue has been relocating underground utilities and the delays
that work has caused.

Earlier this month, the
city hired transportation consultant Philip Shucet, former Virginia Department
of Transportation commissioner, to assist with the project. He said the
light-rail construction "is a very complex project in an urban area with a lot
of contractors all working at the same time." Shucet said his job is to try to
remove complexities. One way he's doing that is renegotiating with contractors
for price guarantees. He said that can make costs more predictable, and "you
can stop focusing on the day-to-day minutiae of change orders and devote all
your attention to delivering the contract."

Townes said that HRT
recently hired a transit construction expert and a financial consultant. He
noted that the original design of the light-rail project was "bare bones" to
meet stringent criteria for federal money. He said the newest budget is close
to the price tag HRT estimated several years ago before slashing more than $100
million in a "value engineering" exercise to reduce costs.

"Many of the elements
removed have now been put back in the project," Townes said.

Even at the new price,
Norfolk's project is still the cheapest per-mile of any light rail built this
decade in the country, at about $44 million per mile. The next closest is
Charlotte at $48 million per mile. Others range from $55 million per mile in
Portland, Ore., to $600 million per mile in Seattle, which included a tunnel.

Meanwhile, Wood said he
worries about the fallout for possibly extending light rail into Virginia
Beach, which is under study.